Financial Advice 2.0: Inventing super-human advisors

In a world where technology is ever-changing and regulations ever-increasing, human advice is costly, ineffective, and risky. Robo-Advice, on the other hand, doesn’t resonate with clients on a personal level. Now, what is there to do? Here the Cyborg, the Hybrid-Advice philosophy enters the scene. A human advisor with tech-supported superpowers. 

The best of both worlds: efficiency with a human touch 

The problem today is, that human-centered advice is more expensive than ever. And clients are reluctant to spend money on it, especially when there are alternative services in the market available free of charge. Regardless of the availability of such services though, customers still have complex needs. And the faster financial markets advance, the more complex those needs get. A demanding regulatory environment for banks and their advisors puts them in an unpleasant spot. So, what is the current quick-fix given these circumstances? Private banks increase the minimum assets required to become a client or they abandon the typical financial advice altogether. Some banks and Fintechs try to disrupt the market for financial advice with Robo services, but with mixed success. What are the main obstacles for both? Robo Advisors lack the human touch and Private Banks are less efficient.  

The answer to this challenge is a technology that enables financial advisors to be more efficient in targeting the right clients and giving them personalized proposals. Instead of going through many different lists and investment guidelines (blacklist, recommendation list, etc.), the software handles the process. Instead of checking if the proposal is within the boundaries of the portfolio, or if any client- or bank-restrictions are violated, the software can handle that within seconds. The advisor can focus on the needs, wishes, and financial status of the client. You tease out what the client needs, manage the relationship, and the software calculates the right portfolio, the right products, gives you the right story with every possible recommendation and handles all regulatory aspects for you. 

“Humans lack efficiency and Robos lack humanity. Give advisors super-human capabilities by supporting them with software in a hybrid advice model. Give them the power of software efficiency with a human touch�? 

How to save 10 weeks per year for every advisor

Imagine you offer your advisors a tool that frees up 10 weeks of their time every year. 10 weeks focusing full time on the client. Establishing and caring for better client relationships. Here are 6 practical ideas on how to get there: 

1. Be clear about your investment philosophy and set up a clear investment structure and process that contains:

•  Categorization of Risk Profiles (How do you categorize your client’s risk profiles?)
• Risk and Strategy Offerings (What investment strategies or risk levels do you want to offer?)
• Mapping of risk profiles and risk levels
• Asset Allocations and Time Horizons

•  Sufficient Regulatory Information
• Regulatory Restrictions
  

3. Define your investment universe

• Set up a set of securities that you wish to use as possible investments for your clients
• Include buy/sell/hold recommendations from your research

4. Define bank restrictions on the allocation

•  Have a blacklist containing, e.g. non-ethical investments
• Have certain risk boundaries for asset classes or single investments
  

5. Give your client and advisor the possibility to include their wishes

• Ask if the client wants to limit exposure to an asset class or investment
• Ask if the client has a blacklist or darling stocks  

6. Connect for a seamless and efficient process

•  Integrate the advice software to your core banking system to process orders directly
• Automate regulatory reasoning to have a compliant and transparent decision process 

All of these proposals can be configured and extended to your business model.  With our hybrid Advice Software, financial advice gets more reliable and transparent without losing individuality and gives you the edge in a competitive market space.